Wells, Drilled and Dug; and Dry #242
CATEGORY: Legally Speaking
TAGS: Property Condition Disclosure Rural Real Estate
By Gerry Neely
Well, well, well - city dwellers who are moving in increasing numbers beyond the limits of city water to purchase rural property and who, if asked to measure a well drink would do so in ounces rather than gallons per minute, are finding that their well being may be well-nigh impossible to achieve because well, let's say it - the well ran dry.
Although paragraph I (i) of the Property Condition Disclosure Statement puts the onus upon the seller to describe the quantity or quality of well water, as a call from an up-country REALTOR indicates, REALTORS can still be drawn into a dispute initiated by a buyer unhappy with the seller's representations concerning the quantity or quality of the well water.
The cases dealing with the potential liability of an agent predate the valuable protection the Property Condition Disclosure Statement (PCDS) offers both buyers and REALTORS. However, the use of the PCDS may not, in the circumstances of a particular case, displace the REALTOR's obligation which has been stated many times by the courts in general terms, "to check the completeness and accuracy of all information which is usual and customary for agents to verify, and all other information as to the completeness and accuracy of which the REALTOR is in doubt."
An example of what a court might expect a REALTOR to do is found in a case in which the agent repeated the seller's representation that the well produced between three and four gallons per minute. According to the judge, the problem for the REALTOR was that she should have know that this statement was untrue.
The REALTOR had the listing for eighteen months and from her local knowledge knew that the water supply from wells in the area was described as spotty. The REALTOR had a clear recollection at the time she took the listing that the seller told her he did not have a well record and did not know what the recovery rate was for the drilled well. It was this prior knowledge that should have made the REALTOR doubt the completeness and accuracy of the information supplied by the seller, an omission which led to liability for both the seller and the agent.1
Contrast this decision with a 1985 case, in which the REALTORS were fortunate. The seller had represented that the well was drilled, when in fact it had been dug. The REALTOR accepted this information without checking, but the judge excused the REALTOR's failure to verify the information provided by the seller.
The judge was satisfied that the seller's misrepresentation was so deliberate and intended to mislead, that the seller was guilty of inducing the erroneous conclusion by the REALTOR, which led to an advertisement of the property which the seller knew would be false. For these reasons, he imposed liability upon the seller only.2
It isn't always necessary to have exact information as to the number of gallons per minute the well will produce. In one case, the seller of rural property testified that with reasonable use the seller had an adequate supply of water for his family, guests, and livestock.
The new buyers who moved in with a portable swimming pool, with a capacity of 18,000 gallons, found the supply of water to be inadequate for their purposes.
The disappointed buyer lost an action for damages when the judge concluded that while the water supply was limited, the seller had not misrepresented its adequacy for the uses that were normal for the occupancy of rural property.3
REALTORS should assume that if there were Rural Real Estate Rules, equivalent to Murphy's Law, then rule number one would be:
(a) a farm for sale has a well on it that provided sufficient water over a ten year period, for a family of seven, four horses, 12 cows, 25 pigs, 120 chickens and a number of summer guests who overstayed their welcome.
(b) a REALTOR, who sold the property, can be assured that the well will dry up seven days after the buyer takes possession.
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